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Ally Bank
Screenshot of the IRA Online Savings Home Page Ally Bank

For many, the thought of savings is something that gives them palpitations and shivers. They cannot bear to risk tying up their savings and running into an emergency financial situation. The Ally Bank IRA Online Savings account solves this dilemma by providing customers with the means to save. Not only are these account affordable as there are no minimum savings required, they also allow customers to access the funds within a short notice period.

Why An Online Savings Option Is A Good Place To Start

Whether the account is the straightforward savings account or the one specifically designed for IRAs, it meets those niggling savings needs. These accounts are easy to open and easy to manage. Furthermore, they are often the luring cards for banks who wish to expand their customer base. This means that customers often have the benefit of higher interest rates to look forward to.

These accounts are also simple to understand and even simpler to open. There are no frills and fuss and customers can do their transactions online. There are no minimum balances to maintain, and the majority of the transactions are free. The transactions that are charged, are available to customers upfront.

Finally, these accounts are usually great for trusts, however, the IRAs are for individuals only.

The Different Types of IRAs

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Screenshot of IRA Type Home Page Ally Bank

There are different options that are designed to ensure customers choose a solution that is beneficial and unique to them.

Traditional IRA

This option is suitable for customers who prefer an account that allows a tax-deferred growth. Furthermore, this means that the customer doesn’t pay taxes on the funds until they withdraw the funds when they reach retirement. Also, customers may also be able to deduct their contributions from their tax return. This, however, depends on their income level.

Roth IRA

Customers who wish to have a retirement plan where the growth is tax-free will find the Roth IRA to be the ideal option. This account allows customers to make tax-free withdrawals of any original withdrawals they made at any time. Furthermore, customers are limited to maximum income restrictions should they wish to contribute to a Roth IRA.

SEP IRA

Small business owners who wish to contribute to a retirement plan now have a unique offering. The plan is designed for tax-deferred growth and is open to the business owner and any other eligible employees.

We recently did a review on all the Ally Bank IRAs on offer.

Why Going With Ally Bank Is Natural Option

Ally Bank is widely regarded as the frontrunner when it comes to the online savings products. Over the years, they’ve evolved into what is now known as the benchmark where digital banking is concerned. Ally Bank is also critical in the movement for the cashless society. But before Ally Bank became the online savings hero of the States, it was a humble finance wing for GM.

Automobile Finance and World War Support – A History of Ally Bank

In 1919, GM decided that it needed to do more to help the American public reach their goals of owning an automobile. At the time, finance through banks was restricted and limited, and the general public didn’t have ready access to it. They founded GMAC to provide a unique type of automobile finance that was the first of its kind. It also provided customers with far more than just regular finance, as it was tailored to the individual needs of the clients.

This all took place just as WWI came to an end when the American population was in desperate need of finance. It was only a decade later that Black Tuesday took place and with it, the start of the Great Depression. Disposable income was in short supply and the need for finance was a way of life. In 1939, just as the Great Depression came to an end, WWII took place.

GM was at the forefront of providing the necessary components for war machines such as submarines. This helped the Allies solidify their position and eventually win the war. GMAC was taking care of things on the home front, as the Great Depression left an angry mark on the American economy. At that time, the railway lines were in desperate need of funding, which GMAC provided.

Modern Ally Bank

After the war, the economy started strengthening and it was time for GMAC to introduce a few new products to the market. Over the next couple of decades, customers would have access to more comprehensive insurance plans and mortgage loans. GMAC also started looking and commercial finance options.

The 2000s brought along with it many changes, and for GMAC it meant changing from a finance house into a full-fledged bank. After the 2008 financial fallout and subsequent bailout, the institution was formally changed to a bank. With it came the name Ally Bank. Soon after, Ally Financial was formed and Ally Bank became a subsidiary.

The bank is now one of the leading banks on the savings front, providing incredible products with competitive interest rates. Furthermore, the bank is also fully automated and all operations take place online. The bank has moved away from the typical traditional branch setup and is the benchmark of cashless banking. Learn more about Ally Bank in their full review. 

Benefits of Opening An Ally Bank IRA Online Savings

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Screenshot of the Rate Comparison Ally Bank

This is the idea account for those who are unsure of whether they are able to commit their funds into savings over a long period of time. The account is flexible and customers have access to their savings in an emergency, without having to worry about penalties.

Furthermore, this account also provides a high-interest rate, which makes it highly competitive and beneficial for those who have their funds in there.

Customers are also not pushed into committing a large amount of their savings to this account, as there is no minimum balance required. The account provides flexible funding options for Roth, SEP, and Traditional IRAs.

Apart from earning a high-interest rate, the interest also compounds daily which means customers enjoy maximum earnings. The account also doesn’t carry any monthly maintenance fees.

Finally, customers enjoy the benefits of FDIC insurance, which covers balances up to a specified amount. We recently did a review on the regular Ally Bank Online Savings Account

Restrictions of Opening An Ally Bank IRA Online Savings

Although this is an online savings account, it does have a few restrictions. A limit of six transactions per statement cycle apply. Those who exceed this limit will pay penalty fees.

Customers don’t pay a monthly fee on this account, however, there are certain transaction fees that may eat into the growth of the plan. Furthermore, there is also a waiting period of at least 7 business days before accessing funds. This is a short time compared to the other accounts, however, can feel very long when an emergency occurs.

The FDIC only insures deposits up to a certain amount, and amounts exceeding the cover are at risk.

What We Like About the Ally Bank IRA Online Savings

This is the perfect starting place for anyone who wishes to save. It is a simple account to open online and customers will have online access throughout the life of the account. They also have access to service specialists 24/7 should they require assistance.

There is no minimum opening balance required, making the account available to those who have no other means of saving as well. The interest rate is very competitive and customers can watch their funds grow as they experience the effect of compound interest.

Customers can rest assured that this account supports all IRA types. Customers have access to the funds although there is a short waiting period. Furthermore, the limitation of 6 transactions per statement cycle will curb unnecessary spending.

Finally, there are no monthly maintenance fees and the transaction fees are minimal. Furthermore, customers are aware of the fees upfront ensure transparency.

What We Don’t Like About the Ally Bank IRA Online Savings

This account is the sweetheart of the Ally Bank arsenal and with good reason. There are very few things to fault on this account as it is a healthy mix of accessibility and rate. What could be a possible detractor is the fact that the transaction fees, when they happen, are very high. This could eat into the growth of the plan if customers aren’t 100% aware of their costs at all time. It’s also imperative that customers keep track of their transaction numbers, in order to avoid the penalty fee should they exceed the six-transaction limit.

Critical Reviews Rating of the Ally Bank IRA Online Savings – 10 of 10

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Screenshot of NerdWallet Rating of Ally Bank

There is nothing to fault with this account, as all the restrictions and limitations are clear. This allows customers to proceed with the account with an open mind. Furthermore, the account has a sterling reputation due to its incredible interest rate and accessibility. This is a prize product in the Ally Bank fleet. 

Ally Bank also launched a credit card.

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